You can either add this to your userChrome.css file or install it as a Stylish script from the link below. As it is, it will gradually "fade out" your bookmarks bar for 30 seconds, before disappearing entirely. If you'd like it to disappear a bit quicker, you can change the two 30s values above to something smaller, say 2s or 3s. This will make it disappear much faster, and give you that vertical space to work with until you need it again. Whenever you mouse over the Firefox toolbar, your bookmark bar will show back up.

Some may find it a little too much of a "parlor-trick", as PrairieMoon describes, but I actually find it extremely useful for, say, my netbook, on which vertical space is a premium. Eye candy aside, I found it to be a pretty useful feature. Hit the link to see more.